The growth translated into a significant increase in our operating profit during the period to EUR 91 million. Capacity was increased in key markets by the successful addition of two new factories and new production lines in existing plants. However, the key enabler of the profitable growth was a major improvement in quality and throughput brought about by a focused, globally coordinated team effort.
-Revenues in 2008 amounted to EUR 885 million up from EUR 579 million in 2007. All LM Glasfiber’s regions contributed to the sales increase and in particular the North American and Chinese markets recorded strong growth.
-Operating profit amounted to EUR 91 million compared to a loss of EUR 40 million in 2007. The improvement is due to higher revenue, a significant reduction in provisions for the retrofitting of delivered blades, and a turn-around of the Spanish operations.
-Earnings before interest, taxes, depreciation, amortization and special items (EBITDA) amounted to EUR 145 million compared with EUR 75 million in 2007.
-Investments related primarily to strategic investments to strengthen our technological leadership and to add new factories in North America and Poland, as well as capacity expansions in China, Spain and Denmark, and amounted to EUR 161 million compared with EUR 73 million in 2007. Total new capacity added in 2008 amounted to approximately 2,000MW.
-Cash flow from operating activities amounted to EUR 101 million compared with EUR 2 million in 2007. This is mainly due to the increase in operating profit.
-Financial reserves at the end of the year amounted to EUR 138 million compared with EUR 66 million in 2007. Impacts from the global credit crunch also became visible in the wind industry in the last quarter of 2008. Consequently, wind park development was delayed due to the difficult conditions for financing. For 2009 we expect global market growth to decline due to significant project delays and we do not expect our total sales to increase. We are taking steps to adjust our capacity in order to maintain our competitiveness and expect these restructuring costs to impact our operating margins negatively.
Roland Sundén, CEO of LM Glasfiber, said:
"We are pleased with the results we delivered in 2008. The results demonstrate that our global transformation program, initiated in late 2006 and early 2007 to optimize our capacity ramp-up, improve our quality and throughput, as well as our financial performance, has worked very well. Agility and flexibility are critical success factors for a company like LM Glasfiber and in 2008 we demonstrated our ability to grow both rapidly and profitably, while improving output, costs and quality at the same time. 2009 will be a challenging year and we do not expect to see the same global market growth as in previous years.
The financial turmoil continues to make financing difficult in the short term and to cause delays in planned projects in some regions. We however expect the Chinese market to continue to grow in 2009 and we will grow with it through our new factory in Qin Huang Dao. The long term outlook for the global wind industry remains strong, not least because of the global commitment to combat climate change and promote energy independence. We remain confident about the future. We have an attractive position in the market thanks to strong long term relationships with our customers that were further developed during 2008. Our strong financial results, combined with continuous process improvements throughout the company, strengthen our relative competitiveness which is the best guarantee that we will be able to expand operations profitably again as soon as demand comes back.” The financial statements were adopted at LM Glasfiber Holding A/S’s Annual General Meeting earlier today.
The Annual Report 2008 for LM Glasfiber Holding A/S is available for download at www.lmglasfiber.com/investor
For additional information please contact: Søren Knudsen, VP Chief Commercial Officer Tel. +31 63 9114 803, E-mail: SFK@lmglasfiber.com